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House Democrats Move Aggressively on Energy

Ignoring a White House veto threat and warnings from Republicans, Speaker Nancy Pelosi (D-Calif.) outlined a massive energy package Tuesday that appeared to contain nearly everything she has sought this year, including shifting billions in tax breaks from oil companies to renewable energy and enacting a renewable electricity mandate.

At press time, Democratic leaders were whipping votes for the measure and planning to bring it to the floor today, but the vote could be close given strong Republican opposition to the tax and electricity provisions.

Two other provisions — enacting a 35 miles per gallon fuel-efficiency standard for cars and trucks and a boost to mandates for using renewable fuels like ethanol — have generally strong support across party lines. A landmark compromise brokered last week between Pelosi and House Energy and Commerce Chairman John Dingell (D-Mich.), in which Pelosi gave the Detroit auto industry a package of incentives and more flexibility, secured the support of GM, Ford and Toyota.

But some utilities, particularly in Southern states, as well as the oil industry, continued to fight to defeat new mandates and tax hikes that would cost their respective industries, even as President Bush’s advisers hinted at a veto that could scuttle the whole package.

Senate Democrats also said compromise was likely in the offing, regardless of what makes it through the House.

“We’re going to have to deal with the harsh reality that we’re going to have to find 60 votes in the Senate and produce a bill that the president will sign,” said Senate Majority Whip Dick Durbin (D-Ill.).

Senate Republicans including Sen. Pete Domenici (N.M.) have been angered by the inclusion of the electricity provisions, and the outcome of a final vote remains in doubt.

Nonetheless, Democrats who have been leading the charge for a comprehensive energy overhaul defended the package as historic, and held out hope that Bush would ultimately decide to sign it.

“We know we are in for a very tough battle and we are going to do our best to win it,” said Rep. Ed Markey (D-Mass.), chairman of the Energy Independence and Global Warming Committee.

Rep. Rahm Emanuel (D-Ill.) said high energy prices and other issues called for a more-expansive energy package, not a scaled-back version. And he noted that many states have already put in place renewable electricity requirements.

“President Bush signed one when he was governor of Texas,” he said.

“My belief is that seeing the package as a whole, the Senate will pass it,” said Rep. Tom Udall (D-N.M.).

Markey said Democrats have already compromised on the standard, given the provisions on energy efficiency and the original goal of 20 percent.

And he ridiculed a suggestion by the administration that the standard should allow states to opt out.

“We think there should be a standard with no state left behind,” he said. Markey said creating a national market in renewable energy would drive down costs and make renewable power more affordable.

“If it’s good enough for Texas it should be good enough for the rest of the country.”

Pelosi’s office released some of the details of the new bill before press time, arguing that it would result in lower overall energy prices, reduced reliance on foreign sources and reduced carbon emissions.

More fuel-efficient vehicles will save Americans $700 to $1,000 a year at the pump, saving $22 billion in 2020, Democrats said. A $21 billion tax package would repeal tax breaks for oil companies — breaks Democrats say are no longer needed with oil company profits at record highs and prices about $90 a barrel.

But the renewable-electricity provisions were generating the most heat on both sides Tuesday. Utilities would have to generate 11 percent of their electricity from renewable sources, with 4 percent more from either renewables or energy-efficiency measures. Democrats contend that the measure would reduce overall energy costs by reducing demand for natural gas, while Republicans called the provision “unattainable” for some states, and said it would force them to pay other states for renewable credits.

The bill also has new energy-efficiency rules that would require more-efficient appliances and improve the efficiency of buildings.

Democrats said the bill would generate millions of new jobs to generate green energy, but Republicans charged it would cost millions of jobs by driving up energy prices.